Triton Minerals (ASX:TON) has added its Ancuabe project to the due diligence for funding agreement from Chinese equity firm and resources trading company Shenzhen Qianhai Zhongjin Group Co., Ltd, due to queries from the Ministry of Commerce & Ministry of Land and Resources.
A positive outcome from this expanded due diligence process may allow Triton to access additional capital from SQZG to develop the project in Mozambique.
In April, SQZG agreed to provide funding of up to US$200 million (A$255 million) under the letter of intent to build and develop a graphite concentrate operation with initial capacity to produce up to 200,000 tonnes of graphite concentrate per year from Nicanda Hill.
This included an off-take agreement with an initial term of 10 years at 200,000 tonnes of graphite concentrate per year.
SQZG subsequently received inquiries from China's Ministry of Commerce as well as Ministry of Land and Resources about Triton's graphite projects.
As a result, SQZG considers Triton's Mozambique graphite to potentially be of strategic importance for China.
Along with the continued encouraging metallurgical results being obtained from the Ancuabe and Nicanda graphite projects, SQZG is also seeking an extension to the due diligence period for up to six months to incorporate a formal review of the Ancuabe graphite project.
The extension of the due diligence period will allow Triton sufficient time to obtain initial drilling, additional assay and metallurgical results from the Ancuabe graphite project.
Recent flotation testing showed the majority of graphite material at the Ancuabe Project appears to be jumbo and super jumbo flake size.
The results indicated that 72% of graphite material is classified as jumbo flake size (>300µm) with 92.1% of the flakes being larger than 150µm.
Using a cut off of 425µm, 98.9% of the graphite flakes are >212µm.
Graphite is readily liberated by crushing, grinding, rougher and cleaner flotation, with no additional regrind required. This demonstrates excellent jumbo flake preservation using simple, low-cost processing.
Ongoing tests are being completed to optimise grade and milling circuit.
Drilling will be carried out this month that could confirm economic quantities of large and jumbo flake graphite at Ancuabe.
SQZG's proposal to expand the due diligence program to include the Ancuabe project and extend the period by six months confirms the continued encouraging results being generated by Triton Minerals at both Ancuabe and Nicanda while providing more time to complete a more detailed review.
It also highlights the potential strategic significance of Triton's graphite for China and elsewhere, and further justifies the rapid development of Triton's Mozambique graphite projects to meet the growing global demand for high quality graphite products.
Success could see the accelerated development of both projects, allowing expected large-scale commercial graphite production to be achieved earlier than originally scheduled.
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